Looking for Mr. Right

Don't you wish you could locate, attract, and hire that one big-league player you need to push your company to the next level? That seasoned rainmaker, finance wizard, or operations whip who'd enable you to do what you do best? Jeff Braun wished so, too

A year ago I wrote a short item about Maxis, a rising software developer with a string of best-selling simulation games. Maxis had earned success by riding the distribution coattails of Broderbund Software, itself a fast-growing software publisher. Their arrangement wasn't unusual in the game business, but Maxis's software had sold especially well. At the end of my conversations with Maxis chief executive Jeff Braun, he mentioned that the Broderbund arrangement had run its course, and he'd recently hired his first vice-president of sales. He'd recruited Sam Poole directly from Walt Disney Computer Software, where Poole had been head of sales. Braun's voice, usually flat, betrayed awe -- as if he couldn't quite believe his good fortune. He encouraged me to talk to Poole.

Disney Software. What could have lured an executive away from the Magic Kingdom? When I finally caught up with Poole, some months later, I learned that Maxis's VP was an alum of Procter & Gamble and also of Polaroid. He had even run a company of his own. It had been his plan to spend the rest of his career at Disney, Poole, 46, said.

After a year with Maxis, it certainly looked as if Poole had made a good move. He was already VP of sales and marketing as well as general manager. "At Disney that would have taken 10 years," he told me. Besides initiating a U.S. sales force, he'd opened Maxis's first overseas sales office. And most impressive, Poole had revived sales of Maxis's aging flagship product. "It's worked out perfectly," Braun, 38, affirmed.

I couldn't help thinking that if Maxis could land Sam Poole, there was hope for other small companies searching for Mr. or Ms. Right. I'd heard from CEOs who dreaded the idea of finding a sales manager and didn't know where to start. And even more often, I'd heard CEOs express their anxiety about finding the person who could take their companies to that mythic "next level," open bigger doors, and kick some professionalism into their seat-of-the-pants sales operations. Surely, plenty of talent was available, what with layoffs and the uncertainty of big-company life these days. But here at Inc., we'd heard countless tales of horrendous clashes between big-company veterans and the small companies that hire them.

So, what made the Braun-Poole relationship click? I visited Maxis last November to find out.

* * *

Orinda, Calif. -- population, 16,700 -- is a bedroom community boasting great schools, little crime, and an easy commute to San Francisco ($4.10 round-trip on BART). It's a town where the cops recognize all the cars that "belong," and it's home to Maxis, the software publisher known for such simulation software toys as the top-selling mayor-for-a-day game, SimCity, and the more recent SimHealth.

Maxis is a company with an attitude. A Washington Post reviewer noted that "Maxis software stands out because these are programs with a platform." And with 95 employees, five-year-old Maxis also stands out as the town's number one employer. "After us, it's the Safeway," says Maxis's laconic Braun.

Maxis's headquarters are in a small mall that mirrors the buying habits of SimCity's upscale core audience, but there's nothing pretentious about the company. Employees who wish to use the bathroom step outside to the public facilities. Maxis's "entertainment room" houses pinball machines and an ancient movie-theater popcorn machine, and Braun's windows frame mountains crisscrossed by utility wires and poles. It's neither picturesque nor opulent, but it's comfortable.

To the citizens of Orinda, unassuming Maxis is the great corporate hope. "They've got a good thing," says the owner of the Squirrel's Nest, the mall's country knickknack store. "I'm buying the stock as soon as they go public."

Maxis rose fast from its basement days. It took two full years to create SimCity, but in 1989 first-year sales hit $3 million. Last year sales broke $20 million. Maxis has made Orinda into one of those entrepreneurial outposts that now dot the country. Still, Maxis is not a household name.

A decidedly glitzier entrepreneurial landmark shimmers about 260 miles south, in Burbank, Calif.: the Disney legacy. In addition to its vast entertainment properties, Disney comprises a catalog division (Disney Direct), a budding magazine empire ( Discover,Family Fun, Disney Adventures), a National Hockey League franchise (the Mighty Ducks), and Disney Software.

Sam Poole entered that scene in January 1991 as director of sales at Disney Software. Though probably the least known of the Disney companies, it offered him the chance to make his mark at the world's most creative corporation. For a boy raised in the darkness of a Pennsylvania mining town, the view couldn't be much brighter.

"I felt that Disney would give me the opportunity to really stretch, to take advantage of those intellectual properties, the characters, the name." He was sure he'd never leave, and within a year he'd moved into his dream house, outside Malibu, "the home I thought I was going to retire in."

Poole's experience made him a welcome addition to Disney. During the 1970s he'd worked at Procter & Gamble (where he learned sales discipline) and Polaroid (where he learned to be creative), and in 1983 he turned to the software business and rescued a small company partly owned by Gillette. It was, Poole says, "my introduction to this nutzo field." He moved on to another struggling software developer, called Cinemaware. There, he says, "I was to advise the owners on marketing and international sales, but I ended up running the place."

By then Poole had decidedly mixed feelings about working for any more start-ups. He has unpleasant memories of "waking up at 2 a.m., worrying, 'Am I gonna make payroll?' I thought maybe the answer was getting back into a corporate environment again."

With Mickey and friends, Disney was poised to cash in on the interactive-entertainment and education markets. Its success with a Roger Rabbit computer game had persuaded Disney, in 1988, to create a unit under the Consumer Products Group. Two years later Disney Software introduced a pricey first product to underwhelming response.

Poole, with his contacts in the software distribution channel and his operational know-how, was recruited in 1991 to redirect the foundering unit. "It could have been extraordinarily exciting," he says, recalling his early enthusiasm.

It wasn't long before his plans were being second-guessed by the folks upstairs -- all the way up to Roy Disney and Michael Eisner. "Every time I turned around, I knew it was going to be one more fight," he recounts. "I felt good because I won most of those battles. But knowing that I had to fight before I could start the struggle to make the business grow got tedious. Disney Software was a small part of Disney, but it was very much a corporate environment."

* * *

By 1992 Poole had been at disney for a year and was still searching for the chance to "stretch." Meanwhile, Maxis was starting on its fourth year of sales and CEO Jeff Braun was looking for someone to help lead his young company into uncharted territory.

Braun needed a sales director. Desperately. Maxis had no sales force and no store merchandising -- Broderbund was supposed to take care of that. Marketing consisted of a customer-service department, sporadic newsletters, and a smattering of direct mail and consumer-magazine ads.

The Broderbund deal -- Maxis got 80%, or $14 to $20 on wholesale prices of $18 to $25 -- financed Maxis's growth. Healthy profits had even allowed Braun to recruit some professional management. (See "Letting Go," page 5.) Problem was, lots of people mistook Broderbund for SimCity's creator. And it had been anything but easy to get Broderbund to sell SimCity in the first place. Even after SimCity sales took off, Braun says, Broderbund never gave him the sales support and feedback that he needed to grow Maxis intelligently. By 1992 Broderbund's $2-million "tab" was just salt in the wound. At that level, Braun decided, "we could do very nice sales and distribution ourselves."

Still, he was justifiably nervous about breaking away. He'd seen a few friends go out of business trying to do just that. Braun realized that Maxis could use "a net underneath the tightrope." In June 1992 the respected Manhattan firm Warburg, Pincus Ventures exchanged $10 million for 30% of Maxis's stock and a seat on its board. The new board had a definite agenda for Braun: bring sales in-house.

Word went out that Maxis was looking for a VP of sales, and the telephone game began. One West Coast sales manager called another until, shortly, Sam Poole got the word from his sales buddies. Though the grapevine salary -- around $100,000 -- was in his ballpark, Poole wasn't curious. Headhunters and venture capitalists called him all the time.

At the time Poole was searching out potential marketing partners for his Disney venture. More than Disney, Maxis had won numerous accolades for its violence-free games. "I knew that Maxis was one of the 'good guys," Poole says.

Braun, coincidentally, had asked a colleague to arrange a phone introduction with Poole, who was known to him as a force in the industry. So when Braun got a call from Poole one fine spring day in 1992, he had no doubt that Poole was interested in Maxis's sales position. Poole was circumspect. He wanted to meet Braun in San Francisco to discuss mutual marketing opportunities. Braun, who wears a tie only under pressure, remembers the day Disney hotshot Poole flew up to meet him. Braun wore a tie that day.

The meeting took place at the swank Hyatt Regency at the San Francisco airport. "We went out to the patio for breakfast," Poole relates. "I'd brought my big sales case. I had it all." He presented notebooks of the various product promotions he'd created over the years and benchmarks he'd developed to help forecast sales and product life cycles.

Poole had wanted to impress Braun with his sales-management repertoire, and he succeeded. Braun's head was spinning. As a CEO, he'd been unable to get sell-through figures from software retailers. And this outsider was confidently telling him, for example, that for a DOS-based product, expect 55% of first-year sales to come in the first 90 days of a launch.

Though floored, Braun was not speechless. When the CEO realized that Poole wasn't interviewing for the job, Braun mustered his composure and questioned Poole about his experience, just for the heck of it. Finally, he sputtered, "Do you want a job?"

The offer was good for a laugh. After all, the Disney executive had come courting Maxis. But Braun wasn't joking. "I was sold on Sam the first time we met," he says. "He showed me how he does his reporting, and it blew me away. It's thorough and easy to understand. It was obvious that this guy had his thumb on the operational side of the business."

Until then Braun had not fully understood how the lack of sales expertise was shortchanging his company. Most of the sales types Braun had interviewed were sharks. "All aggressive." And their reporting skills were lacking. "They could sell, but whether they could sell intelligently, I don't know."

* * *

Weeks passed. The Disney marketing deal -- nixed by the folks upstairs, who might have been happier dealing with a Microsoft rather than a Maxis -- never happened. Worse, Disney, it seemed, was throttling back the software unit. "That's when I got disheartened," Poole remembers.

And that's when he got the call: Jeff Braun. Could he and his Warburg board member visit Poole for a "follow-up meeting" to tie up loose ends? It was just after the Disney deal had gone sour. And Poole, as one observer puts it, was stuck "running something that's like a pimple on the back of an elephant."

"It was funny, because they made me a job offer in my office at Disney. I almost started laughing when they did it," recalls Poole. "I wasn't expecting it, though it's the third time I've had a job offer in my office. The first time, I was with Procter & Gamble, and Polaroid approached me. It's a ballsy approach."

Braun, however, denies bravado. "We happened to be in town, and it was a total whim. We weren't trying to recruit him. We just wanted to check out Disney. But there was Sam sounding depressed. So we said, 'Why don't you come work for us?"

Warburg, Pincus partners Henry Kressel and Bill Janeway put no pressure on Braun to hire Poole, but they didn't hide their opinions, either. They all knew Maxis had to emerge from the video-whiz-kid stage to become a full-fledged software publisher. For that, Kressel points out, "you want an operations person with P&L responsibility." Poole's experience running a small, struggling company had impressed the investors.

"We've been in the business of recruiting executives from bigger companies for years now. Lots of catastrophes," says Janeway. "There are people who can't make it happen without the support structure. I once recruited someone from the second-largest computer company. The first thing he did was create an organization chart with a VP of administration. There were only 13 employees. That company didn't do very well."

Braun had already interviewed a slew of highly qualified candidates. He'd come very close to hiring a person whose credentials weren't nearly as impressive as Poole's. Their conversations ended abruptly, though, when the guy made the mistake of demanding more money. Braun had no desire to work with someone whose only love was money. Besides, he concluded, "though he met all the requirements for VP of sales, that's all he would have been. Never anything else."

That marked the onset of discussions with Poole, for whom pay was not the deciding factor. Braun determined that what motivates Poole "is not money. It's responsibility -- the more, the better."

* * *

For about two months Poole and Braun spoke first thing in the morning and sent faxes to each other most nights. Maxis couldn't match Disney's marketing machine or its Michael Graves-designed headquarters. But Braun could guarantee Poole the satisfaction denied him at Disney.

"Obviously, Sam could do more than just fill VP of sales," says Braun.

"I was looking for the chance to be more like an owner," Poole responds. "Bonuses are important -- for keeping score. It's part of the game. But I don't operate just on money. I once took a test on what motivates salespeople, and I ranked low on money."

More than anything, Poole maintains, "I wanted to make major decisions for a company. To be a critical decision maker is so satisfying. That's something you almost never get in a big company." He wondered whether Maxis could provide that fulfillment.

"I asked to talk to all the upper management of the company -- the board of directors, the chief financial officer, the VP of marketing, and the VP of product development," Poole says. "I could clearly see that there was real room for somebody to come in and make a contribution. It's the kind of environment that welcomes it."

* * *

Product discussions with Braun also helped convince the Disney executive that he'd feel comfortable at Maxis. Back and forth, Braun and Poole swapped thoughts on strategy. Would the Sim line translate well overseas? Why develop one kind of game and not another?

"We talked about his philosophy toward product," Poole explains. "I describe it as baring heart and soul. A lot of software companies produce product just for the economic gain. So few deal with social issues. Maxis has some strong thoughts on that."

Like all developing relationships, however, there were rough spots. "I once said, 'Jeff, this product doesn't make sense. . . ." Poole says, laughing as he recalls an instance when he jumped on a pet project of Braun's. "He got mad."

A sheepish Braun called back later to say, "I'm sorry about that."

"No, I'm sorry," Poole replied. He'd learned something critical from the exchange. "Anytime you consider moving into a new position, you want to know the parameters. Could I go to the wall with something? When would I need to check in with Jeff first? I wanted to come in and be very aggressive. We reached some common ground."

Braun concedes it's tough for anyone who reports to the president. "It seems as if the president can plod into anybody's area, and he can. But that can ruin a relationship. It's important to define the boundaries ahead of time."

Braun and Poole quickly agreed that to sustain its fast growth Maxis should itself sponsor fledgling game developers, just as Broderbund had carried Maxis -- only do it better. To be able to help not one young company but many companies would fulfill Poole's desire to make a difference in a big way. "I knew I could make a contribution," says Poole. "That was my overriding goal."

Hammering out compensation details was fairly painless. The base salary was set at about a hundred grand -- the going price for top sales-management talent in the software industry. Braun upped it a bit. The two then went to work on a bonus plan that potentially could account for 30% to 40% of total compensation, much like the one Poole had enjoyed at Disney. At Disney all of his bonus goals were tied to sales volume.

At Braun's invitation Poole set his own bonus goals. He proposed linking 50% to sales and the rest to management goals for gross margins and operating income. The management goals proved a tough challenge, and Poole, in effect, took a pay cut. "I made more money at Disney," he reveals. "But I like this bonus plan better."

The issue of equity was the most difficult. Maxis managers own 1% to 2%. So the value of Maxis stock was of more than passing interest to Poole. Warburg, Pincus, which had recently completed a valuation, was able to give him some answers that apparently were persuasive.

Poole felt confident that he would do well at Maxis, but there were such practical concerns as the "beautiful house I'd just bought. Prices for houses in southern California were crashing at the time." A bonus Maxis paid Poole for "signing" helped cushion the blow, and the company also covered his moving expenses.

And there were family matters. Poole's son and daughter from his earlier marriage lived out of town, but his wife, B.J., had a job, her daughter, and most of her family in southern California. "It was important for B.J. to see Maxis and Orinda herself," Poole says.

"I drove them around, showed them the neighborhoods, and introduced them to a Realtor so they'd get a sense of the price of housing," Braun recalls.

Braun's effort was worth double points with the Pooles. "He spent a whole Sunday just driving us around," Sam relates. "He put us up at a nice hotel. Very, very seldom do you see that in large companies. I don't know if all small companies do it, but they should. It impressed my wife. If B.J. had hated the whole idea, I wouldn't be here. I left the final decision to her. I said, 'Here's where I see the pluses and minuses.' I was making good money at Disney and was successful. I said, 'I can continue on. So the question is yours to answer.' Jeff's effort made it a lot easier for her to decide."

* * *

Just as Braun wanted Poole to know what was important to Maxis, he needed to confirm that Poole was the right person for his company. "A lot of the salespeople I'd interviewed had silly ideas for selling my products," says Braun. "They were crippled by their experience in the teen video market. I wanted a sales VP who understood my customer. Our core audience is the adult PC user, the high-end yuppie character; those people are the 'early adopters,' the first in the word-of-mouth chain. I started Maxis to create entertainment programs for adults. Sam got that. Others didn't see the point, didn't think it was a proven market."

Some founders dread hiring a sales director for fear that person will destroy the easygoing company culture. Braun shared that anxiety. "We're almost antisales as a company. We don't brag. We do a really good job and let the market decide. If you want it, you're going to buy it, right? If not, go somewhere else. That's our attitude. Horrible for sales. We wanted aggressive salespeople. We just didn't want them to run herd over us. We're sort of mild and meek. I had to get the programmers and everyone used to the idea that we were going to promote the hell out of stuff."

* * *

After two months of thoughtful back-and-forth, Poole joined Maxis in August 1992. Within three months, he'd established a sales force. Before he'd hired a single salesperson, though, he'd installed an internal support structure -- complete with sales forms, policies, and procedures. Before the Christmas rush Poole had regional sales reps in place.

He used industry averages assembled by such groups as the Software Publishers Association to project Maxis's monthly unit sales for 1993. Living up to expectations, Poole, with few exceptions, was on the money. He worked up sell-in reports, which spelled out which distributors and stores bought what, and sell-through reports detailing what consumers purchased. "A lot of people have the information," he says, "but don't take the time to see what it means."

With marketing director Robin Harper, he focused on repackaging the entire Sim line. He developed Maxis's first retail promotions. He wrote up rollout plans for the new SimCity 2000.

And the cost of sales? Poole has spent less than the 20% of sales that Maxis was giving to Broderbund. "Quite a bit less," he says. After reviewing the sales-and-marketing costs of six public, profitable competitors, he has determined that 16% is an appropriate goal for Maxis.

* * *

To an outsider Poole and Braun appear to be perfect opposites. Braun is skinny and pale, a once-avid skier who prefers a healthful diet. Poole has a ruddy complexion and a linebacker's build, and he enjoys more than the occasional smoke. Poole single-mindedly pursued an M.B.A. and a job at Procter & Gamble. The young Braun skied his way through college and has no diploma to show for eight years of classes.

Their management styles are also a study in contrasts. Poole likes to engage employees in conversation. Braun holes up in his office, "intuitively," he says, sensing the mood beyond his door. And he prefers not to be in on every management decision. A guest could easily mistake Braun for one of Maxis's programmers, but Poole conducts an office tour as if he owned the place.

And it works.

"Jeff openly admits he's not particularly strong on the operational side of the business," says Poole.

Braun confesses, "I still have difficulty reading a balance sheet."

"Jeff is extremely well liked throughout the industry," Poole continues. "So he's great at making strategic alliances and determining the course of the company. It's hard to find a visionary like Jeff who gives up operational control."

Oh, there have been tense moments. Some managers worried that with Poole there they were less valuable. And lots of Maxis employees wondered why the company would spend money on store marketing and promotions. "We never did them before," they said. "So," says Poole, "I showed them the analysis to prove the merit of these programs." Just as he'd done at every other company, starting back at Procter & Gamble.

Braun concedes, "My biggest anxiety was the rest of the management team. I figured either the team would respect him because he knows a lot, or they wouldn't respect him because he knows a lot. Sam earned their respect."

* * *

On January 3, 1994, Jeff Braun announced Sam Poole's promotion to president. Braun remains chairman and CEO and will focus on opportunities in entertainment software. Poole now runs the day-to-day operations.

"Sam didn't come with the expectation that he'd be president," says venture capitalist Bill Janeway. "He naturally became the leader by taking a decisive role in the company's transition from a phenomenon to a business."

LETTING GO

In just one horrid month in 1990, Jeff Braun realized that he couldn't, and really shouldn't, continue running Maxis on his own.

"We were at about 20 people, and all 20 were reporting to me. I was running everything. The IRS audited us. My girlfriend left me. I met with my partner, Will, and I said, 'I'm not having any fun anymore. I'm burning out.' He said, 'Jeff, do whatever you want to remove your stress. But do it quickly.' "

Braun did. He hired Ernst & Young to audit the books. "I decided I'd rather have them than the IRS." Then he enlisted an E&Y software specialist as his "corporate shrink." The diagnosis: you need senior management.

"So we laid out the whole program of bringing on managers one by one. First, product development. That was our biggest problem. Next accounting, then marketing.

"For about a year after that, the company was very top-heavy. But with the venture capitalists, it played in our favor. I could convincingly say we have room to grow without adding overhead." -- S. G.

IN THE EYE OF THE BEHOLDER

Sam Poole's Checklist

CEO maturity. "Jeff was no longer an entrepreneur. He was head of the company. He'd made that transition."

Management team. "I looked at the strength of personnel because no one person can do it all."

Perception in marketplace. "The Maxis games were getting good reviews in Newsweek, Time, and the New York Times."

Growth potential. "A lot of companies are small and successful. It's hard to become big and successful."

Financial stability. "When you see a venture-capital group has done due diligence, you have a much higher comfort level . . . and the money gave Maxis a very solid cash basis."

Product vision. "There's a heart to Maxis -- a concern about world pollution and the management of cities."

Career path. "I could see that if I came and demonstrated quickly what I could do, the Maxis environment would allow me to do what I wanted to do."

Jeff Braun's Checklist

Industry knowledge. "Outside of me and my VP of product development, none of the management team had much industry experience. Sam brought a lot of common sense because he's been in the industry so long."

Buyer connections. "We sell to fewer than 40 accounts, and I wanted someone who already knew as many of those people as possible. Sam knew everybody -- on a personal basis."

Shared vision. "I wanted someone running with me."

Skilled communicator. "Sam communicates well with me and my board -- reports, situations -- I've never seen anything like Sam's reporting to this day."

No Gordon Gecko. "Our sales force has to reflect the company's culture and product. Sam has a big heart. He's caring and takes ownership, but it's not an ego thing."

Team player. "Sam gets along with the other managers, who are all very different. I didn't want a lone wolf."

Promotable. "With Sam, I knew I was getting more than I was paying for. He wasn't just a sales VP but a potential president. Sam was a great bargain."

HOW'S HE DOING?

Sam Poole, himself

"When I first got here, Maxis had strong packaging and strong PR. That's only half the battle. Maxis's market share was actually on the decline. Sales were going up but not growing as fast as the rest of the industry. If everything had been perfect, it wouldn't have been as exciting or fun. Our market share has taken a dramatic jump up."

Will Wright, cofounder and games designer

"Sam surprised me. It's amazing how fast he's gained a feel for our company -- from products to cash flow. Jeff and I used to always talk, so at first it was weird to consider Sam's point of view. Now I prefer it. Day-to-day operations, Sam's good at that. I never was. There's a certain bias now toward market surveys versus going with our gut. It's a more balanced approach."

Robin Harper, VP of marketing

"I was excited about his experience. He had contacts everywhere. We'd had a strong consumer focus before, but he quickly gave us a real retail presence. He understands the promotional needs of different accounts -- from Egghead to Wal-Mart. And Sam's enabling me to take some interesting directions."

Steve Abrew, customer-support manager

"He's been innovative in some areas but conservative in direct marketing because his background is the retail channel. I think more people are going to buy at home, via catalog, phone, or computer. He set the price on the Sim-City 2000 direct-mail offer too high because salespeople said, 'Hey, don't cut into sales.' We got a lot of orders, but I expected a higher response."

Tim Zuckert, group product manager

"Sam's a fun person to work with, and he's willing to be challenged. He's hired good salespeople, and he's done an excellent job of linking sales and marketing. He's brought a number of our retail accounts and distributors into marketing meetings to get a sense of their expectations. Now I can call the head buyer at Software Etc. That's nice."

MAXIS'S TIME LINE

1987 Braun hosts a pizza party for San Francisco-area programmers and meets Will Wright. Taking $100,000 from Braun's former company, the two start Maxis. Start-up HQ: Braun's living room.

1988 A year into developing an urban "simulation toy," the partners wonder how they'll sell it. No one will license the game, but Broderbund agrees to distribute it -- for 20% of gross sales.

1991 SimEarth joins SimCity on the best-seller lists. Maxis hires more "pixel pushers" and goes to work on SimAnt and SimLife. March: Robin Harper, a veteran of big ad agencies, is named VP of marketing. Sales: $10.6 million. Employees: 50.

1993 March: the break with Broderbund is official. Repackaged SimCity has its best year ever -- 228,000 units sold. SimFarm milks the school market. September: Poole is named general manager. November: Sim-City 2000 is introduced, with store promotions, including a $5 demo disk and a drawing for a free trip to London; and an aggressive direct-mail campaign. Projected sales: $21.5 million.* Employees: 95.

1994 January: Poole is made president. His goal: consistent quarterly (after-tax) profits of 10%. Three-month SimCity 2000 sales outpace the first two years of the original SimCity's sales. Preparation for a possible public offering. Projected sales: $35 million.* Projected employees: 120. * For fiscal year ending March 31.